KESTRA revenue growth and expanding gross margin

What happened: Kestra Medical (KMTS) reported a 63% year-over-year revenue growth in Q3 2026, driven by a 58% increase in prescriptions and improved revenue per fit. Gross margin expanded for the ninth consecutive quarter to 52.6%. Meanwhile, Omega Fund Management trimmed its KMTS holding by 351,442 shares in Q1 2027, reducing the position value by $16.06 million. Tandem Diabetes Care, a competitor, is shifting supplies into the pharmacy channel, aiming for a 60%-65% gross margin and a 2026 tubeless launch.

Market impact: The medical technology sector is affected, with investors monitoring KMTS's growth trajectory and gross margin expansion. Tandem's strategic shift could reshape the competitive landscape, impacting both companies' valuations and market share.

What to watch next: Investors should closely monitor KMTS's Q4 2026 earnings (expected in late January 2027) for further insights into its growth momentum. Additionally, the market will keenly await Tandem's 2026 tubeless product launch and its impact on the competitive dynamics in the diabetes care sector.